HNW investor advice needs ‘unmet’

The 2014 High Net Worth Investor Report – compiled off the back of a survey of 3,115 Australian HNW investors – found while investor demand for additional advice is “alive and well”, the research house estimated 256,000 investors have “unmet advice needs”.

“HNWs are prepared to spend, collectively, an additional $560 million annually on advice, which is on top of the $1.9 billion they are already paying,” Investment Trends analyst Irene Guiamatsia said.

“This is a tangible opportunity for the financial advice industry,” she said.

The report also found an estimated 175,000 investors has used an adviser in the last 12 months ending October 2014.

“Whilst steady in absolute terms, this represents a decrease in usage from 44 per cent of HNWs in 2013 to 40 per cent in 2014,” a statement from Investment Trends said.

Investment Trends also found the HNW population experienced the largest growth in numbers in the past five years, swelling from 400,000 in November 2013 to an estimated 443,500 in October 2014.

“This is the largest annual increase in the number of HNW investors we’ve seen in the past five years.

“Collectively, Australia’s HNW investors hold $1.6 trillion in assets, nearly equivalent to the entire superannuation industry,” Ms Guiamatsia said.

The research house explained the growth in numbers was primarily fuelled by a strong performance of the share market and property market.

“[Also] during the period, [significant investor visa] holders (better known as the 888 visa, aimed at attracting affluent Chinese investors) brought $2 billion onshore.

“But with an estimated 385 visas issued, [this] represented less than one per cent of the growth in millionaire numbers,” the statement said.